This is the type of tax you would like the shopping cart to charge. There are two options available

Retail - Recommended
This is the normal and recommended method to charge tax. Your customer is expected to pay tax after all coupons and discounts are applied.

Wholesale / MultilevelTax is calculated before any discounts are applied, this means that the full tax on the retail price would be charged even if the agent buys the item at a discounted rate.

This allows the merchant to setup a shopping cart that is specifically designed for use only with registered agents or representatives. In a normal wholesale situation an agent would not be charged tax since they are purchasing for re-sale. However that means the agent now needs to track their sales tax and pay the appropriate agencies. This option is designed to shift the need to track taxes to the shopping cart merchant. Thus making the agent have a lot less paperwork to deal with upon a sale.